then the prime minister, the home secretary, and members of parliament react to president trump's retweet of anti-muslim videos last week. ♪ announcer: this week on "q&a," hoover institution senior fellow john cogan. he discusses his book, "the high cost of good intentions: the history of the federal entitlement programs." ♪ brian: john cogan, author of "the high cost of good intentions." when did you get interested in entitlements? john: it goes back to my years in washington in the 1980's

during the ronald reagan administration. i served for a few years at the office of management and budget. it was at that point i saw how these entitlements grew and how difficult they were to control. that was the origins of my interest. brian: how long were you there? john: i was there for three years at omb. i served prior to that at the department of labor. i left omb in the mid-1980's, and then returned in 1988 to serve as the deputy at omb and returned return to stanford. brian: what were the lessons that you learned working at the office of management and budget. john: the main lesson was just how difficult it is to control spending. it seem like all of the forces in washington were towards war and more spending. ronald reaganw, more than any other president made a comprehensive effort to rein in government spending.

he was modestly successful. having been part of that battle, i saw how powerful these forces were expanding government spending were. brian: my biggest surprise in your book was fdr. tell that story. john: most people think that the entitlement state began with fdr. that is in fact true. social security. but the franklin roosevelt of 1935 was not like the franklin roosevelt of 1933. franklin roosevelt, in 1933, managed to engineer the largest reduction in any entitlement program in american history. in his first year in office, he removed nearly 400,000, mostly world war i disabled veterans from the rolls.

he reduced the veterans compensation rolls by 50%. an extraordinary change in the whole history of entitlement programs. what was interesting about it was the way that he went about it. when he entered office, we were in the midst of the great depression. the federal budget was in shambles. he had campaigned on a promise to get the federal finances under control and to do so by reining in government spending. the veterans programs accounted for about 25% of federal spending at the time. so we had to do something about veterans programs if it would control spending. seven days after taking office, he asked congress for the authority to modify all veterans entitlement programs. and sent up to the hill a proposal that congress abolish all entitlement programs for veterans and give him the authority to write the regulations and set that if it

-- benefit levels. 10 years later, congress passed the economy act which did so. within the next year, the administration changed the benefit levels, changing eligibility rules, and the result was nearly 400,000 veterans were removed from the rolls. what was most interesting to me about roosevelt's action was that beside the fact he took action right away when a president's strength is at its maximum right after an election, he was a brilliant politician. so to get the bill passed, he -- to qualify to some extent extentto mollify to some

the bonus marchers that had returned to washington. as you may recall, the year before, a group came in and were driven out of washington by u.s. soldiers. bonus marchers were world war i veterans who had been promised a bonus benefit in addition to their compensation. that promise had been made years earlier and payment was due about 10-15 years down the road. they wanted that bonus payment now. they were suffering from the depression, said they wanted the bonus payment now. so, they marched to washington to demand their bonus payments in 1932. they gathered and set up tents. i think there were around 20,000 of these bonus marchers. the government was very worried about communist infiltration. finally, general macarthur ordered american troops to go drive out the bonus marchers. it was a very large scandal in american history. one group of american soldiers

drove out a group of american veterans from the nations capital. brian: anybody killed? john: one individual i believed was killed during the action. so the bonus marchers then returned in 1933 to protest against the proposed reduction and to claim their promised benefits. roosevelt was very different. his solution was to send eleanor out to the camps and have her sing songs and listen to the veteran plate and sympathize with them. jobs.o offered them 25,000 civilian conservation jobs would be set aside for veterans. with those two actions, the veterans went away peacefully. and he was able to go through with his regulatory changes.

brian: the economy act of 1933 was what? what did that do? john: it literally repealed all federal entitlement programs for veterans compensation programs. it repealed the entitlement of veterans had to world war i, disability benefits, rebellion benefits, spanish-american war benefits. the only entitlement program that was exempted was the civil war pension program. but in addition, it allowed the president to set the new rules of eligibility and allowed to set new benefit levels. brian: you say the night before it was introduced he had his first fireside chat. this fireside chat, seems to me, 30-some, like

twitter in those days. here is an excerpt of fdr. roosevelt: i can assure you, my friends, that it is safer to keep your money in a reopened bank than it is to keep it under the mattress. the success of our whole national program depends upon the cooperation of the public, on its intelligence support and on its use of a reliable system. clip] deo brian: what is he doing here? john: during that speech he was tackling the main problem as he sought with the private financial system, which was the banking crisis. we have so many banks. at that point, that evening he also to be opportunity to deal with the problem that he had with the congress, with respect to the economy act. he was worried about a senate filibuster of his bill. the house had passed the bill already. the next week it was coming up in the senate. worried about a filibuster, he devised a strategy to prevent the senate from filibustering. he decided it was time for a

beer, as he told his senior staff that night. he introduced a proposal that would allow for the sale of 3.2 beer. it was prohibition at the time. this was wildly popular. under the senate rules, in order to vote on the 3.2 beer proposal, they had to first dispense with the economy act. of course, they passed the economy act without a filibuster so that they could get to the 3.2 beer bill. they did so, both bills passed and both became law. brian: as you say, 400,000 vets know longer get their pension benefits. let me go to the whole point of your book. what is an entitlement?

john: that is a good question. the word entitlement has come to mean many different things to many different people. to some people, an entitlement is something that cannot be taken away. that people have an absolute and irrevocable right to. other people regard pensions or entitlements as an unearned benefit, as something that can be taken away and something that is not really deserved and is distinguished from an earned right benefit, like social security. people on the latter group save -- say social security is not an entitlement, they have earned their benefits, whereas a food stamps benefit, they regard as an entitlement. in the simplest terms, in entitlement benefit, or entitlement program, originates with a law that says, if you meet some pre-specified eligibility rule in law, then you will be guaranteed a benefit under the law.

brian: how much has war in our history created the need for entitlements? john: i would have to say, in the 19th century it was the primary driver behind entitlements. the first entitlement program was a program for revolutionary war veterans. the idea was to compensate them for the loss of life, or limb while in service to their country during the war of independence. that was the very first entitlement. throughout the 19th century, during every war, we established a similar entitlement for veterans of those wars. brian: you are saying it was disability at first, but then it spread to people who just where

in the service, then you say the wives. explain how that all happened. john: this phenomenon that i am about to describe is common throughout 200 years of entitlement history. it is common among all entitlement programs. basically i will describe in general. what happens when an entitlement program is created, the eligibility pool is a very narrow group of particularly worthy people that are usually deemed to be eligible for benefits. then, over time, a group that is just outside that eligibility circle begins to clamor for benefits and pressure congress to be included among the receiving benefits. eventually, congress acquiesces those individuals qualifying for benefits. that just starts the process all over again. another group of people closer to the eligibility boundary line

starts clamoring for benefits. congress eventually acquiesces. eligibility expands. we start always with a very small group and it spreads outwards. to a point where the original purposes of these entitlements is no longer recognizable. so for the civil war program, the original entitlement program for disabled revolutionary war veteran was confined just to members of the continental army and navy. they were a federal responsibility. but then 20 years later they wanted to include members of the state militia.

volunteers, these individuals were no less deserving of the systems as those in the continental army. by the 1830's, congress had extended the program to include anyone who had served in a revolutionary war for at least nine months. the next entitlement program, large entitlement program was the disability program for union veterans during the civil war. that program followed almost exactly the same path. first then were confined to those that had been disabled during wartime service. 30 or 40 years later, virtually all union veterans who have served their country in the civil war were made eligible for assistance. that has been the pattern that has driven entitlement in the modern era as well as during the 19th century. brian: in your introduction, you say 55% of all u.s. households received cash or assistance from at least one major federal entitlement program, let me read on. among all households of people

headed by a person under 65, over 40% received title benefits. led by auseholds single mother received benefits and nearly six out of every 10 children receive benefits. 58 percent are growing up in a family under an entitlement roles. how long has it taken us to get to 55% of all households receiving something? john: about 70 years now. most entitlement programs begin with good intentions. the intention there is to provide compensation for soldiers disabled during the war. you can hardly see a more honorable purpose for the program. the new deal of entitlements and

great society of entitlements, they had very good intentions to provide a safety net of assistance against old age poverty, to provide rejection -- protection against poverty for those who cannot provide for themselves. these are goals everyone in america shares. what we got today is described with those statistics from the book is a system that does not bear any resemblance to those a -- basic goals. that is the nature of the growth of entitlements and that is why we have a problem today. brian: here is more from fdr, beautiful black and white done by the minneapolis pbs station. he is making fun of them republicans. let's watch. [video clip] in socialeve security, we believe and work for the unemployed, we believe in saving homes. cross our hearts and hope to die. [laughter]

>> we believe in all these things, but we do not like the way the administration is doing that. just turn them over to us. we will do all of them. we will do more of them, we will do them better, and most importantly, the doing of them will not cost anybody anything. [applause] [end video clip] brian: sounds a little familiar. john: doesn't it? what a masterful politician. that has been the promise of those that got entitlement. you can have it, i will give it to you and it will not cost the country a dime. brian: so who has been better or worse at this over the years? republicans or democrats? john: i have to say this has truly been a bipartisan effort. as you go back to the 19th century, with the civil war

pension program. it was during that era that the republicans used pensions to gain an electoral advantage. in fact, the pension program helped realign the public behind the republicans during the 1890's. he held the white house, the house and the senate for 14 consecutive years. i think largely because of tariffs and the pension program. the democrats were generally opposed to pensions until they caught on in the first decade of the 20th century. in the modern era we see the same phenomenon, except the parties flipped. the democrats have been the proposers of all the new entitlements and the republicans have stood in opposition, initially.

once they have gotten to power after an entitlement has been commuted, they have generally supported the expansion of those entitlements. brian: we have some video on both sides, but on the one hand, then several years later on the other hand. let's start with harry reid. let me just start with the dates. the first part is 2006, the second part is 2013. here is harry reid. [video clip] >> today the senate is considering a bill to increase the nations debt by $781 billion. if adopted, it would be the fourth such increase in five years that this administration has been in office. i will be opposing this latest request and i hope that people on both sides of the aisle will do the same. it allows the united states to meet its obligation or it should be the standard. [end video clip] brian: the first time george

bush was in office, and the second time he was not. [laughter] brian: before you comment on it, let me put these two together. here is speaker of the house paul ryan. first is in 2011 and the second is in 2017. [video clip] >> if we fail to put our budget on a sustainable path, and we are choosing decline to world power. the unsustainable trajectory of government spending is accelerating the nation towards the most predictable economic crisis in american history. >> you are not prepared to say that you are insisting on revenue-neutral taxing that does not add to the deficit? >> we want the economy growing that will get middle income taxpayers a tax cut. we want to keep american businesses in america. that is more important than anything else. [end video clip] brian: what are we supposed to

believe, who and when are we supposed to believe? john: consistency has never been a hallmark of members of members of congress. it is a far larger problem than any single member of congress. it is a problem with the institution, it is a problem with the presidency. like i said, it is a problem that for 200 years, these forces that are operating on our congress, on our elected official, just powerful forces for what you are seeing, what we saw with paul ryan, and what we sow it harry reid are just examples of how individuals react to those pressures, pressures to be reelected. brian: go back to your government experience. what were the first years that you are there?

john: 1981 and 1982. i was assistant secretary at the labor department. brian: what was your big take from that experience? john: it was just how difficult it is to lay in these entitlement programs. 1981 and 1982 were years of a very, very deep economic recession as the federal reserve and administration tried to ring administration out of the economy. the recession that we had was a deep recession that we had had since the end of world war ii. so, immediately, that recession caused congress to start rethinking the wisdom of the initial reductions that it had made in the various entitlement programs. i saw this tremendous pressure coming from the hundreds of lobby groups that have been formed around these programs

they gain their sustenance from these programs. from the general public for some relief from the hardship of the recession, but the pressures were just overwhelming. this was a cry for reagan to stay the course and that meant to keep those tax rate reductions that you had put in place and keep those budgets savings that you have put in place. do not give up on them. i think reagan was very, very strong and not giving into those pressures that were operating at the time. brian: who was your secretary of labor? john: it was a wonderful man, raymond j. donovan a terrific young man. actually, a middle-aged man who is treated very, very badly by washington. as you may recall, ray, after serving for almost four years as secretary of labor and

undergoing an enormous number of investigations, including special prosecutor, all of which had shown that the charges that had been made against him were completely made out of whole cloth. the district attorney of the new york indicted him on the same charges and he had to resign from office. truly a sad, sad washington story. brian: i am not sure this is the exact quote, but my memory was, he said, where do i get my good name back? john: that is right. brian: you have watched a lot of governments since then. is it too big a risk today to come to government because of what happens once you're in it? john: there is a risk. the important thing about ray donovan was that he was exonerated of all charges and walked out of the courthouse to make that famous, famous comment. i would say this, yes there are

republic services in washington, but i would say tnp but, do not allow that risk to deter you from service. from my own standpoint, public service is one of the most enjoyable, one of the most interesting, one of the most rewarding periods of my entire life. i do believe that young people should experience the same, and do the same and try to do something good for their country. brian: what was the second time you are in government? john: i moved from the labor department to omb and i was at omb for 3.5 years. i had most of the entitlement programs under me. then i left washington and came back in 1988 as a deputy. brian: so you were in the ronald reagan administration. if you came in 1980 and was still ronald reagan. when did you leave government forever? john: i left in the spring of 1989. brian: did you have any impact on reducing the entitlements when you were the deputy, or even before that? john: very, very little. very little. brian: is this society of a mind that, it should not just be 55%,

maybe it should be 75% of entitlements. john: yes. yes, yes. there were some successes. entitlement spending under the reagan administration was not cut by normal accounting. what we did was slow the growth. the growth was slowed by about 50% over the eight years. so, there was an accomplishment there. but the programs remained in place when ronald reagan left office, then, since then they have grown back. the reduction, if you will, and the growth spending was really just a temporary reduction. ryan: we hear that all the time. that all thehear time. isn't that just a gimmick politicians use about the

growth? let me ask you this. dick cheney said, who cares about the debt? so are we just going to jack -- keep jacking bit debt up to $20 trillion as we have it now? john: history teaches us that excessive debt will eventually cause a financial crisis. history does not provide us with much of a guys about which point -- a guide about at what point, how high that debt has to be before the crisis will hit. ryan: when did it do it in history? brian: when did it do it in history? john: net let's go back to germany. example ofy good where they had an enormous debt problem after world war i. they chose to deal with that debt problem with inflation and the german hyperinflation was one of the most extraordinary economic events of the 20th century. it practically ruined the

economy and led to the rise of not see his them. -- nazism. some very severe consequences. we know it will occur, we just cannot say when and we don't know how severe it will be. the 2008, 2009 financial crisis should be a good lesson for people thinking about the consequences of entitlement programs. government officials did not see the great recession of the great financial crisis coming in 2006, 2007. wall street did not see it. few people saw that crisis coming. all of a sudden it was upon us. that crisis was driven by excessive wall street debt. brian: the only people that lost were sabers. if you were in the market and stayed in the market it went from 5800 up to 23,000. people that do not make a lot of money cannot save a lot of money and even those that want to save money cannot make it dime. john: the consequences of that economic crisis are present today.

the low interest rates we have john: the consequences of that economic crisis are present today. the low interest rates we have in the inability of people who have prepared for the retirement. they are suffering from the consequences of that economic crisis. think about it. that economic crisis was really generated by one sector of the economy. public debt crisis that brought on by the federal government is a far bigger crisis with far bigger ramifications. so as severe as the 2008, 2009 recession was, the consequences of not feeling what entitlement was is far more severe.

brian: explain this, many politicians on both sides talk about the middle class. they want to help the middle class. people that have lived a long time cannot save and make any money. they are actually punished in this process. they have been punished but nobody ever talks about that. john: that is exactly right. . doesn't t's like it exist. brian: brian no, it is an extraordinary phenomenon where middle-class wage orders -- wage earners receive very little. it is an extraordinary phenomenon. wage earners have received very little in the form of wage increases. retirees have been able to earn only returns on safe investments. they have been able to go into the stock market at great risk and earn something there, but by and large the great part of the middle class has been paying for the bad economics that we followed in the great recession and the period leading up to the great recession. brian: you are talking that politicians that make the decisions on entitlements have good intentions, but you also say it is an electoral decision, a political decision.

. decision.political brian: so how do you mek those two? i am doing this for the people and i have good intentions, but i am also doing it to get reelected? john: the legal way to think about it is, entitlement programs stem from a basic human desire to help someone who is in need of assistance. it is just common. all of us have it in us. for politicians it is a little easier. of course, it is somebody else's money. but they still have that same basic desire that you and i do. they also have this desire to be reelected. once that entitlement is put in place, then the game has changed. interest groups form around protecting that entitlement, pressing for more assistance. money starts flowing to politicians who protect those benefits, and the game changes. it is that desire for reelection that drives a lot of entitlements.

brian: but how difficult is that for somebody to give someone else's money away? john: it is pretty easy. that is why they do it. brian: and then they get praise and voted back in from their constituents. we are in this period now, and this was recorded before any decision was made on the tax bill, where you got to keep your eye very closely on what is going on. john: you absolutely do. i would say this about the tax bill if i could. the way i think about the entitlement problem is we have to reform these entitlements clearly to make them affordable. but if we can get economic growth stronger, faster, we will increase the amount of resources that are available to financing those entitlements. it will lighten the burden of financing those entitlements a little bit. so when people think about solving the entitlement problem

or our debt problem, i think economic growth belongs very importantly in that equation. brian: what if you don't get it? john: we are in real trouble. brian: here is "meet the press" and mick mulvaney, who is the office of management at director, was very much against not paying off the debt, and now he is in charge. let's watch this. [video clip] >> i do want a balanced budget. we have $19 trillion, we got to start balancing budgets. these people are starting about balancing budgets 35 years from now. we can do it, believe me, much quicker. we can do it quickly. >> he even made a pledge to get rid of the debt in eight years. we won't be able to balance the year, but we are in king to get it balanced the 10 years. >> so the goal is to have a balanced budget within 10 years, but basically that means you

will add to the debt every single year in the next 10 years. brian: why is it that in every political campaign, promises are made and they never, ever do what they are promised to do when it comes to the debt? john: it is really sad, isn't it? brian: what are we supposed to do as voters? john: the political climate right now is really not at all conducive to any kind of change in government spending. i don't think we have any good sense of how to get it done. i think washington really needs to step back and take a long look at how they have handled entitlements and government spending. it is really a very unfortunate circumstance, and quite honestly it can't provide himself respect. brian: is that still true? john: i don't think people

should look to government for pride and self respect. i don't think people should look to government for benefits. i think we need to look at ourselves for our pride, for our dignity. i think we need to rely on our own initiative, for our food and for our shelter and for our children. brian: what did that president do for entitlements? john: most people think of richard nixon as being a conservative. i argued in the book that richard nixon was every bit as expansionary when it came to domestic spending in particular entitlements as his predecessor, lbj. . of government can do a lot thing, it can provide a man food, a house. dignity, provide him pride, self respect. brian: is that still true. i don't think people should for pride vernment and government for self-respect. look at we need to ourselves for our pride and dignity. i think we need to rely on our

own initiative for our food and for our shelter and for our children. brian: what did that president do for entitlements. think of richard nixon being a conservative. have arguedue and i richard dixonthat was every bit expansionary when it came to domestic spending in particular entitlements as his predecessor, lbj. i labeled a chapter on richard nixon's presidency as great society two. society one was. john: lyndon johnson's. difference. was the lyndon johnson's great society we saw the enactment of

medicare and the medicaid program, two very large entitlement programs. but mostly the great society was increasing what we think of as discretionary programs. programs for education, programmes for training, a large number of social services, where the money went directly to cities and interest groups in the cities. richard nixon was a little different. richard nixon did not expand programs that much for education and social services, but he did expand entitlement programs tremendously. and that, he created a federal unemployment insurance program. he nationalized the food stamp program, which was a very small program when he took office. he created the supplemental security income program, which establishes a federal floor on income for the disabled and the for th poor elderly. he was a very big entitlement expander.

in fact, he would have gone farther - or tried to go farther but congress would not go along. the proposed the national health insurance plan very similar to the affordable care act, and he proposed federalization of the entire welfare system, which congress did not go along with. so richard nixon ranks right up there along the top entitlement expanders of any presidents in modern american history. brian: originally when medicare was passed, what did they expect to happen, and where were the republicans when that vote was taken? john: the republicans had imposed the enactment of medicare all the way through the 1950's and the early 1960's, as did the southern democrats who controlled the relevant committees in congress. and then with lyndon johnson's sweeping victory in 1964, the southern democrats came along to support medicare, in particular

wilbur mills changed from opposing to supporting, and a handful of republicans joined in support of an acting medicaid in support of the bill that passing - i'm sorry, medicare. after that initial opposition, however, the republicans have in the intervening years supported expansions of the medicare program, as have democrats. and that is really a very typical phenomenon during the post-world war ii era. entitlements enacted by democratic administration, then republicans get in power and those entitlements are continued and opposition by republicans turns to support, and the entitlement grows. a good example of that would be the prescription drug benefit under president george w. bush. brian: hold it there. let's go to video of george w.

bush in 2003. a lot of people said this was in anticipation of the 2004 election. older people - i'm one of them. let's watch. [video clip] pres. bush: in a few moments i will have the honor of signing an historic act of congress into law. i am pleased that all of you are here to witness the greatest advance in health care coverage for america's seniors since the founding of medicare. [applause] brian: how much did that help him in the next election? john: hard to say. i honestly don't think it helped very much. they : do you think thought about it. john: i think they thought it at the time. when that idea was originally developed, it was in 2001. in 2001 the budget was in large surplus. and of course, there is nothing to stimulate interest in expanding entitlement as much as a government surplus. so really the momentum for this

prescription drug benefit got going in the early part of the administration, well before this. brian: you say in your book that when the surplus occurs, they spend. john: that is exactly right. for people today who haven't seen a budget surplus in 20 years, it doesn't seem relevant, but throughout history, whether the surplus is in the budget as a whole or the surplus is in a special account like a social security program or special trust fund, every time there is a surplus the pressures to expand entitlement gets magnified, and congress will eventually spend the surplus to expand entitlement. the problem is many of these surpluses are generated by an upswing in the business cycle. economic times get good, revenues pour into the treasury

or social security system, and a surplus or a big balance builds up. but that balance or surplus is only temporary. eventually the economy is going to go back down to normal and maybe into a recession. but congress has taken those surpluses and enacted a permanent expansion in entitlement in response to the surpluses. so when the revenues go away, programme with a being more of a permanent increase and you get deficits. brian: if i said i want to get a camera crew and you, and lets go show the public where the social security trust fund is, where the money is, where the certificates are, where would we go? john: you and go to parkersburg, west virginia. the story of the creation of the physical representation of the trust fund is a very interesting one. throughout the 1980's and early 1990's, the social security system, because of the growing

economy, developed about $1 trillion in surplus funds that was allegedly sitting in this account. members of congress would go back to their districts for their town meetings and people would ask, if there's $1 trillion there in the social security trust fund, where is that trust fund? the members didn't know because there wasn't one. it was just a ledger in the treasury department books. so they came back to washington demanding that their leaders do something. there is a very ingenious congressman, andy jacobs, a democrat from indiana, and he had the terrific idea to create a physical representation of the trust fund. they passed a bill that would designate a public building as the location of the social security trust fund. brian: is this a joke? john: no, this is the honest to god truth. in 1994 the bill passed, so they set aside a building in parkersburg, west virginia as a bureau of the public debt

building to house a file cabinet and a computer to be the trust fund. the computer would print out certificates that represented surplus revenue and interest came in, and some government official would sign it and stick it in the file cabinet. brian: where is the money? john: the money was sitting in the united states treasury, ready to go out in the form of a payment to a defense contractor or a contractor in the education department. government money is, if you want, spongeable it comes into the treasury, goes out of the treasury. brian: what happened to the idea of creating a trust fund, keeping the money there, and spending it on retirees? john: it was a grand idea, roosevelt's original idea that social security should be self-funded. social security should be a program whereby the individuals

pay into the program and the funds are set aside and able to fund their retirement benefits. the reality is, in the 1930's, once that surplus started getting built up, congress realized, my gosh, it is a honeypot waiting to be raided. and they moved to a system where you pay as you go. where the benefits going out would be no greater in normal coming han the revenues in. is an: west virginia, and the story of the goal miners vbyrd?obert john: yes, yes x in 1969, it is a good example of how little events can create big entitlement programs. there was a coal mine disaster in farmington, west virginia.

several miners were killed in this accident, and it generated a response in washington to regulate the coal mines. i think it was a sensible law to regulate the coal mines. but in the process, mr. byrd and other members of congress decided it would be a good idea to compensate coal miners for black lung disease that they might incur from their years of working in the coal mines. the opponents argued that this should be a workers compensation benefit to be handled by the states. mr. byrd and others argued, but there is none. we need a temporary program. so they enacted a temporary black lung benefit program that entitled coal miners to a monthly disability payment. it was only a temporary program. but of course, several years later when the authorization of that program was about to

expire, congress looked around and no state had adopted a worker's comp. program for their coal miners, so they said, we need to continue this, and they then reauthorize the program. the program is still around today. it has achieved virtual immortality, in the words of ronald reagan. brian: we have been all over the place, but i want to ask you about this book. what's in this book, if somebody wants to read it, what will they learn that we are not talking about? john: what they would learn is that the history of entitlements and the behavior of entitlements that they see today goes back a very long time, and that the forces that are at work on congress and on the executive to expand entitlements are forces that are very powerful. they need to be recognized. they need to be dealt with. and hopefully when leaders understand the nature of what

drives these entitlements, we will all be in a better position to come up with some lasting and effective changes to make these entitlement programs more affordable. brian: is it possible? john: i believe it is. brian: what gives you a sense that it is possible? john: i tend to be an optimistic guy. i realize there are very few historical reasons for optimism, but america has faced all kinds of difficult problems in the past. there have been tremendous challenges that we as a country have faced. this entitlement problem is of a different sort than our problems in the past. but we have risen up in the past to solve them, and i think we would do so here. brian: what percentage of the budget is entitlement oriented? john: right now it is 2/3 of the

budget is entitlements. brian: what would have been 150 years ago? john: it would have been about 10%. but the civil war pension program, as we talked about, was one of the great entitlement programs of the 19th century. that drove entitlements up to 40% of the federal budget in the 1890's, 30 years after appomattox, and it eventually then died down as the soldiers of the civil war eventually passed on. brian: where would you put today in relationship to our 200 year plus history? john: for the last 70 years since the new deal, entitlements have been growing and growing relative to the economy. a larger and larger fraction of our goods and services are being transformed into entitlement benefit that go from one group in society to another. brian: but isn't that good for the society, the people that are out in the united states now have more money than they had

ever had if the entitlements have grown? john: absolutely not. entitlements come from one group in society and are given to another group. brian: but they are the privileged, the ones that make all the money have to give the other side some money. john: no. now you are raising a good point. we think of entitlements as mainly programs to alleviate poverty. the reality is that a minority of the dollars we now spend through entitlements go to alleviating poverty. my calculations are only about 1/5 of the $2.4 trillion of entitlement spending actually goes to alleviate poverty. say it again. 1/5 of the $2.4 trillion every year --

john: -- go to alleviating poverty. the rest goes to people who were not in poverty to begin with or two people who have already been raised out of poverty by other entitlement programs. brian: but somebody is watching right now and saying, look him up i have paid into social security and medicare. don't tell me i don't deserve that back. john: and i would say to them, as far as social security goes, yes, you have paid into social security, and i can understand your desire to get your money back. but you have to remember that the reality is that money that you put in has already been spent. the money that is going to finance your benefits - and you have in some sense earned them - that money is coming from the pockets of workers in their 20's, 30's, and 40's. brian: but that is not their fault. john: it is not their fault at all. it is just the reality. and it is something we need to keep in mind for retirees today. you may have earned your

benefits, but a person that is now being asked to pay for that benefit is a person who is in their 30's or 40's and working a job, trying to build a family, save for their own future. that is who is paying for your benefits. brian: do i remember a figure in your book you say a family of a husband and wife, spouses, after 65 will collect as much as $1 million apiece and social security money. john: just about. brian: to how many pay in that much? john: the fact is that a typical married couple who reaches age 67 this year will receive in medicare and social security benefits, both combined, about $50,000 a year. that is almost equal to the median household income in america today.

so over the remainder of their lifetime, their benefits are going to grow with inflation or healthcare, grow faster than inflation for medicare, and they will receive about $1 million in inflation-adjusted dollars over the remaining lifetime. brian: who attached the to social indicator security. john: that was down in the most extraordinary circumstance, recording social security that i know of. the as done in 1972, and story of it is a very interesting one and illustrative of congress' inability to grapple with these entitlement problems. it began with social security benefits to compensate recipients of the inflation since the last benefit

increase. at the time, social security benefits were not indexed to inflation. congress would regularly increase compensation payments on an ad hoc basis. in the early 1970's, inflation fell on, they were considering a 10% increase in the spring of 1972. four democrats were vying for the nomination of their party for president. wilbur mills, george mcgovern, hubert humphrey, and edward muskie. muskie proposed a 15% increase. mills threw his hat in the ring with a 20% increase, and followed by mcgovern with a 20% increase. hubert humphrey upped the ante, proposing a 25% increase. eventually the senate started looking for a vehicle with which they could attach an increase

to. then frank church came along and said we can do it 20% increase on the debt ceiling bill. it was a bill is expected to be necessary by july 1. the debt ceiling was to expire on june 30. so the senate in the late evening of june 30 passed its version of the debt ceiling bill with a 20% increase in social security benefits on it. the bill went to the house just before midnight. the house had no other choice and passed the bill. brian: did they raise the tax rate at the same time on social security? john: no. in fact, they changed the assumptions about economic growth to "finance the higher benefits". the increase to the assumed growth rate, bringing more a rollback to revenues, and that would finance. so in the same bill, they put in a cost-of-living adjustment, a

permanent cost-of-living adjustment. they wouldn't be every two years enacting and ad hoc increase. turns out they made a grievous error and over indexed the inflation, which they eventually fixed. the point is tha here they were year in, year out since world war ii, passing benefit increases usually in an election year and usually more than enough to compensate for inflation. at the end they said, we are going to stop ourselves before we spend again with this automatic... brian: it seems like you are saying all of these gentlemen are gone. they are dead. they got this opportunity to say, i am going to increase it. they are gone, so when it all falls apart you can blame them, but they are gone. right. that's

bri . soian: 30-year-olds today are the ones that are going to pay the price. john: that is exactly right. but i think today's politicians, we have to figure out a way to make sure those politicians begin to feel the heat through younger individuals that are not going to receive what their elders have. brian: how long have you been at the hoover institution? john: i have been there except for my washington service since 1979 in stanford, california. brian: what's its goal is a set of ideas that define a free society. . you go to re did college. john: i went to ucla for my undergraduate and graduate, a phd in economics. my hometown is in california. brian: you have a family? john: i do. i have a beautiful wife and we have raised six children together. they are in their 30's and late 20's. we just had a wonderful event. our youngest was married a month

ago, and on the same day we had our first grandchild. two different kids involved here. a very fine day. brian: on that note, let's put the book cover on the screen. it is called "the high cost of good intentions, the history of u.s. entitlement programs." our guest has been john f. cogan. thank you for joining us. john: thank you very much. appreciate it. [captioning performed by the national captioning institute, which is responsible for its caption content and accuracy. visit ncicap.org] [captions copyright national cable satellite corp. 2017] announcer: for free transcripts or to give us your comments about this program, visit us at qanda.org. they are also available as c-span podcasts.

announcer: if you enjoyed this week's q and a interview with programme, here are some programs you may like. the president of the committee for responsible budget talks about her expectations for congress and president trump. dr. mark mcclellan on his career at the centers for medicare and medicaid services. and david stockman, former director of the office of management and budget, talks about his book, "the great defamation." you can search our entire video library at c-span.org. announcer: c-span's "washington journal," live every day with news and policy issues that impact you. coming up monday morning, associated press white house reporter ken thomas and the hill congressional reporter mike willis discussed the week ahead in washington.

and an update on the children's health insurance program from penny thompson. and we discussed president trump's visit to utah. be sure to watch "washington journal" live at 7:00 a.m. eastern monday morning. joined the discussion. nourns >> announcer: tomorrow a supreme court argument dealing with rel eejous decision and antidiscrimination lawyers, a colorado bakery that refused to same sex cake for a marriage. live carriage at 4:30 eastern on c span britain's first secretary damian green stood in stood for prime ministtheresa may fos question time.